Like competitors The Talbots Inc. (TLB) and Chico FAS (CHS), ANN is working hard to right size its store portfolio, which in this economy has amounted to closing locations where necessary. Additionally, it is keeping close tabs on inventory management and constantly reevaluating its product sourcing requirements in an effort to reduce costs. ANN has also been successful at increasing sales from outlet stores and online shopping, both of which contribute to lower costs.